Link Real Estate Investment Trust (Chinese: 領展房地產投資信託基金, or 領展; previously known as The Link Real Estate Investment Trust (Chinese: 領匯房地產投資信託基金, or 領匯), managed by Link Asset Management Limited, is the first real estate investment trust in Hong Kong and currently the largest in Asia in terms of market capitalisation. It is wholly owned by private and institutional investors.

Link REIT's portfolio consists of properties with about 9 million sq ft of retail space, around 61,000 car park spaces, and a project under development in Hong Kong, as well as properties with about 3 million sq ft of retail and office space in Mainland China[1]. Meanwhile, it has a development project in Kowloon Bay and two projects in Shanghai and Beijing respectively. [2]

Due to its history of monopoly, controversial business ethics and unfriendly treatment to small business owners and investors, it has been widely considered a "corporate monster" in Hong Kong partly responsible for the city's socioeconomic issues.

The REIT was created by the government, which hived off assets from the Housing Authority that included 151 shopping malls – mainly within public housing estates – and 79,000 parking spaces. The date for the listing was provisionally 16 December 2005, at a valuation of HK$22.2 billion (US$2.86 billion).[3][4] Upon privatisation, Link Reit remains tied to terms in existing tenancy agreements, but will not longer require approval from government to increase rents for new leases. However, financial analysts expected attractive dividend yields – up to 7 per cent – from the privatised company and greater commercial orientation, although some feared that the scope for increasing rental income and cutting labour costs might be limited due to most of its properties being tied to the public housing sector.[3]

IPO of The Link REIT, delayed for a year until 2005 through legal action by housing tenants worried that rents would rise, was eventually 18 times oversubscribed.[5] About 510,000 Hong Kong residents, or seven percent of the city's population, placed US$36 billion of orders while institutional investors were ready to commit US$40 billion.

The proposed flotation of The Link REIT by the Housing Authority was delayed when a public housing tenant, Lo Siu-lan, challenged the legality of the proposed divestment of the properties.[6] Lo's lawyer submitted that the Housing Authority had "breached its duty under the Housing Ordinance to provide housing to people in need. Instead, it was selling assets to a private company, which could sublet the properties at market rates rather than benefiting the underprivileged".[7] She represented a concern among many residents of public housing that existing amenities would no longer be public and that The Link would raise rents, thereby forcing price rises in shops without due consideration of the public good.[6] Some NGOs also were concerned that the reduced income of the Housing Authority would eventually lead to rent rises for public tenants.[6] Lo's request for judicial review of the privatisation was rejected at the Court of First Instance and the Court of Appeal.[7]

Since the listing in 2005, Link has engaged in a process of 'asset enhancement works', seeking to raise the value of the properties through upgraded physical structure, replacing low-end utility local shops with higher-paying brands and chains, enhanced 'customer service', and promotional activities. The Link also overhauled many of the wet markets under its management. The renovations have led to higher rents, higher prices, and the loss of local shops.[8][9][10]

In moves to diversify its property portfolio and mix, Link acquired the shopping mall portion of Nan Fung Plaza with parking facilities in Hang Hau, from Nan Fung Group mid 2010 for a total of $1.17 billion.[11]

In late 2010, Link acquired the shopping mall portion of Maritime Bay Shopping Mall with parking facilities in Hang Hau, from Sino Group, for a total of $588.4 million.

In 2015, The Link took its first step in purchasing by government land auction when it partnered with Nan Fung Group to buy land lot NKIL 6512 in Kwun Tong for a total of $5.86 billion in January.[13] Then, Link surprised the market by successively making its first two purchases in mainland China, when it acquired Beijing EC Mall, for a consideration of ¥2.5 billion; it acquired two commercial buildings in Shanghai for ¥6.6 billion. The company has a target where mainland properties would not exceed 12.5% of its portfolio.[14]

On 19 February 2016, a subsidiary of the Link purchased the Trade and Industry Department Tower in Mong Kok (formerly the Argyle Centre Tower II) from the government for a sum of HK$5.91 billion.[15]

The Link was called a "bloodsucker" by housing estate residents after the company acquired the Housing Authority shopping centres, renovated them, and raised rents. This has led to local shops being pushed out, higher prices, and the dominance of chain stores within the estates.[20][21] This trend has reduced entrepreneurship opportunities for lower income people in Hong Kong's public housing estates and new towns, diminishing their chances to achieve social mobility, and has increased the cost of living.

A 2012 campaign by The Link to promote "nostalgic restaurants" in its shopping centres was widely derided on social media as hypocritical. Users on Golden Forum and Facebook wrote that the company "first killed the shops, then makes money from their death" and criticised the company for only allowing chain stores in their properties.[21]
In 2006, The Link cut thousands of staff, a move "fiercely criticised by unionists, who said Link Management had dishonoured a pledge to protect the welfare of its frontline workers when it took over the operation from the Housing Authority". The Link replied that "the job cuts were in line with private practice".[22]

By mid 2015, NGO Link Watch (領匯監察) published a report that showed big chains made up 76 per cent of the 2,075 shops in 22 shopping centres run by the firm, but the Link's CEO claimed, "We continue to maintain roughly 60 per cent of our shops leased to smaller operators."[14]

Anti-Link REIT protests have become increasingly common in recent years.[23] Link REIT headquarters in Kwun Tong has been the site of demonstrations, scuffles, and sit-ins, leading the company to seek a court order to bar activists from entering the building.[24][25]

Cheung Fat Market, rebranded by The Link as "Cheung Fat Modern Market"

In addition to indoor shopping centres, The Link also acquired many local estate markets in 2005. Such markets are covered facilities with small stalls and shops let out to local residents, generally offering fresh meat and vegetables as well as daily necessities and home wares. As with the shopping centres, The Link has raised rents and also renovated some properties, leading to increased food prices and financial hardship on low-income households.[26]

In Tin Shui Wai, where The Link exercises a near-monopoly on commercial space, the company was criticised by local residents and Legislative Councillors in 2015–16 for planning to convert the Tin Yiu Market into a conventional shopping centre.[27] The market supplies fresh vegetables, meat, and fish to residents of the surrounding public housing estates. The next closest market is 5 to 10 minutes' walk away.

Stall operators at Cheung Fat Estate on Tsing Yi have gone on strike, in 2010 and 2016, to protest rent increases.[26] By the latter strike it was reported that rents had doubled in ten years. Some local residents stated that they visit a government-run market in Tsuen Wan instead owing to the higher prices at Cheung Fat.[26] The Cheung Fat stall owners also protested the outsourcing of the market's management to Uni-China (Market) Management Limited, which they feared will lead to untenable rent increases.[28]

Barriers set up by management at Leung King Estate against hawkers

Uni-China (Market) Management also manages the market at Leung King Estate in Tuen Mun, which is also owned by The Link.[28] In February 2016 a group of men dressed in dark jackets with "manager" (管理員) printed on the backs acted in an intimidating manner toward hawkers in the area of the shopping centre since 2 February. More than 200 showed up to protest against the men combating hawkers on the night of 8 February. Some minor clashes broke out between the self-proclaimed managers and the protesters, and required mediation by the police.[29] Two protesters were arrested and one reporter was injured during the clash.[30]

Conflicts between the management and the public reoccurred on the night of 9 February. The men were filmed beating up protesters while police stood by and prevented others from being involved. A reporter was also beaten up by the control team.[31] A 31-year-old man was arrested for causing disorder in a public place. He allegedly interfered with a worker performing his duties at Leung King Estate. The Link REIT distanced itself from the clashes and denied the hawker control team was part of its staff.[32]

Link REIT has been widely condemned by officials on both sides of the political spectrum. Starry Lee, chairperson of the pro-Beijing DAB, reported that former chief executive Leung Chun-ying "strongly criticised" Link REIT in a meeting with the DAB.[35] In an interview with the South China Morning Post, Leung questioned whether the remuneration structure for top management of Link REIT had led to the trust's behaviour.[36] He said that, as the previous owner of the public housing commercial space, the Hong Kong government has a responsibility to public housing tenants "to satisfy their needs and if necessary to provide alternatives to Link REIT properties". He said that a Link REIT monopoly in public estates was not acceptable as elderly tenants could not be expected to carry their heavy shopping to and from other markets.[37] He said there was no plan to buy back the Link, but the government could explore providing alternatives if the Link was not serving nearby residents.[36]

Carrie Lam, now chief executive, was reported in 2016 (while she was chief secretary) to have called Link REIT one of the "three mountains" – i.e. one of the major sources of contention in Hong Kong society – that the government sought to conquer. Lam stated that the government should explore different avenues toward tackling the problem, including launching a potential legal battle against the company.[35]